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How Does AB 5 Affect Lyft and Uber Drivers?

Lyft and Uber drivers were at the center of a fierce political battle in California recently. At stake was whether they should be classified as employees or continue to be categorized as independent contractors. The rideshare giants lobbied hard for their drivers to be given an exemption from California Assembly Bill 5. In the end, Governor Gavin Newsom signed the bill into law in 2019, with no exemptions included. The law is scheduled to go into effect in 2020. Starting in 2020, drivers for both rideshare companies will be considered employees.

Undeterred, Lyft and Uber, along with Door Dash have united and vowed to spend $90 million to pass a ballot initiative in 2020 exempting their workers from AB 5. The employment law attorneys at The Dominguez Firm are keeping up with all the latest regarding AB 5, workers’ rights and how this may affect you. Below are some common questions we receive regarding this new law.

What’s the Difference Between an Employee and an Independent Contractor?

Here in California, the definition of an independent contractor had been someone who performed a service for a specific amount and controlled how it was performed. However, the California Supreme Court recently challenged that definition. Known as the ABC test, a person is now considered an employee unless the company can prove:

  1. That the worker is free from control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work;
  2. That the worker performs work that is outside the usual course of the hiring entity’s business; and
  3. That the worker is customarily engaged in an independently established trade, occupation, or business of the same nature as the work performed.

What Does This Mean for Me as an Uber or Lyft Driver?

Beginning in 2020, you will be considered an employee of Uber and Lyft. As previously mentioned, both rideshare companies are fighting to have their drivers excluded from this new law. That could take several months to occur if it happens at all.

Even within the ranks of Uber and Lyft drivers, there is disagreement as to whether the passage of AB 5 is beneficial to them. Some are calling for drivers to unionize, while others support the proposed exemption.

There likely won’t be any major changes right away. Also, there will probably be some legal challenges to the new law. The employment lawyers here at The Dominguez Firm are closely monitoring the situation to make sure every worker’s rights are protected.

What Does This Mean for Me as an Uber or Lyft Passenger?

You shouldn’t have any problems requesting an Uber or Lyft ride starting in 2020– at least not initially. But both rideshare companies warn that if they don’t get their much-desired worker exemption, the number of drivers will plummet. That’s because the scheduling flexibility that drivers now enjoy would disappear, causing many people to stop driving for them. They also mention the probability of higher fares for passengers if the drivers are classified as employees.

As of this writing, this is all speculation. What will still hold true in 2020 is that if you are involved in an accident with an Uber or Lyft vehicle, call the rideshare accident attorneys at The Dominguez Firm right away. We offer free and confidential consultations at 800-818-1818.

In all of this talk about the status of Uber and Lyft drivers, one fact remains constant: if you’ve suffered injuries in an accident with either rideshare company, you have the right to compensation for your injuries. And if you’re concerned about the cost of hiring an attorney, know that at The Dominguez Firm, we don’t charge any upfront fees. And you don’t pay unless we win. So call us today!


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